It's Back to Business at NBAA 2001

SPECIAL REPORT. Notwithstanding a three months' delay and an uncertain economy, it was back to business in New Orleans at the 54th National Business Aviation Association Annual Meeting and Convention. As expected, attendance was down. Some of the usual exhibitors could not alter their plans to accommodate the schedule change. Despite those expected hurdles, the business of business aviation advanced at a surprising pace. AVweb's Dave Higdon reports.

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About the Author ...

Dave Higdon has a distinguished background in aviation journalism. As aviation editor for
The Wichita Eagle for more than five years, he has established a
reputation as one of the best general aviation reporters in the business.
Previously, Dave held a variety of aviation journalism assignments with The
Journal of Commerce, Air Transport World, and AOPA. He has covered every
facet of aviation from sport aviation in Tennessee to the FAA in Washington,
DC to Cessna, Beech, Boeing and Learjet in Kansas. He's also a professional
aviation photographer. Dave is an instrument-rated private pilot and owns a very
clean Piper Comanche. He and his wife Annie live in Wichita, Kansas.

Given the ongoing pre-Christmas sales, it has been difficult to avoid an
analogous view of this year's attack-delayed convention of the National Business
Aviation Association: deeply discounted, like so much holiday merchandise. Many within the aviation community discounted the potential value of the 54th
annual meeting after NBAA postponed its original September 18-20 dates in
the aftermath of the September 11 attacks. "NBAA will never be able to get new
dates or, alternatively, enough interest to make rescheduling worthwhile,"
they thought. Some folks even expressed doubts NBAA would reschedule at all.

The verbal discounting continued even after NBAA announced the December 12-14
convention dates. "Nobody's going to be there; nothing's going to happen;
why bother?" some asked. Kudos to NBAA for proving the naysayers wrong.

Serious
Supporters Strengthen NBAA Experience

Small
Crowd
No Handicap For Convention Performance

To be honest, NBAA was off, significantly off  about 66 percent off in the
static display with 50 planes at New Orleans Lakefront Airport compared to
approximately 150 booked for the original dates and the 140-plus that crowded
the same ramp during the 2000 NBAA. The number of exhibitors was off, too, by
about 35 percent, with approximately 680 businesses on-site compared to the
1,049 who had signed on for September. Attendance was also down  reduced to
around 57 percent measured against the expectation three months ago that 30,000
or so visitors would descend on the Big Easy. But the 12,500 or so who did
attend gave vendors and sponsors and the NBAA as much business and enthusiasm as
last year's near-29,000 crowd.

So the discounting stopped at the doors. By the accounts of many, the
reactions of others and the observations of several more, NBAA 2001 didn't match
their discounted expectations  it beat them. To some who attended, the level
and quality of business actually exceeded the levels of conventions past.

To paraphrase one veteran industry consultant's observation to association
President Jack Olcott: NBAA could be in trouble. Many vendors and delegates came
away wondering whether permanently smaller might be perpetually better.

Of course, that's not likely, barring any onerous restrictions that further
hamper the health and utility of general aviation. As Olcott noted, next year's
55th annual convention in Orlando will likely look a lot more like last year's
in all respects.

Fewer
In Number, Greater In Determination

Those Not There Could Be Remembered For All The Wrong Reasons

There's no getting around the perspective that the 54th convention that ended
Friday produced for the hardcore who came, whether member-company delegate or
exhibiting-company staff.

That said, some delegates expressed incredulity at the absence of some larger
companies  many of them among the largest-dollar losers from the decision to
postpone and most able to absorb the loss. Some vendors questioned the decision
of competitors who chose to eschew the show. More than a few from both vendor
and delegate ranks expressed their feelings rather harshly, promising "to
remember next year who wasn't here this year." Some vendors' presence
consisted merely of an aircraft or two on the static ramp  aircraft buttoned
up and locked down, with no staff to deal with delegates who rode the bus to NEW
to view the planes. That inability to see and talk to company reps about those
airplanes added to the frustration and bitterness of some delegates.

But that anger and bitterness may be tough sentiments to maintain after
hearing the variety of reasons why some outlets chose to minimize their
participation. Many are suffering their own problems because of the
postponement. Some of the larger companies continue working to make up time lost
during the grounding. Virtually all the largest companies lost tens of thousands
to hundreds of thousands of dollars when the convention was postponed. Still
others couldn't spare aircraft or people from flight-test programs critical to
those companies' futures.

Many who attended NBAA avoided any significant losses because they carry
their exhibits materials with them and their planned departure dates remained
days away when the delay decision was announced. However, scores of those who
chose to exhibit last week had swallowed the bitter losses of September and then
swallowed more costs last week, like so much castor oil, as a bad-tasting
medicine needed to get better.

Those vendors, most of all, seemed to be the ones delegates and fellow
vendors had in mind when they spoke about the trials and tribulations overcome
to support the aviation community and participate. Three months ago, some had to
recall staff already en route. Others had materials already physically in New
Orleans. Unscrambling the egg had seemed unlikely, even impossible, in
September. Even so, by October, most of the exhibitors who would ultimately be
here were determined to participate. Their motivation was as much to thumb their
noses at the international terrorists as it was to wave the flag and show
support.

Regardless of their stories, none whom we talked to regretted being here and
most expressed a degree of satisfaction with their experience that ranged from
the mildly pleased to wildly surprised. As the event unfolded, this NBAA
convention really defied much of the value discounting thanks to a healthy dose
of news: news of new aircraft programs and products, news of hundred of millions
in new aircraft and systems sales, and news of new industry projections for
healthy growth in the coming years.

Just
Like The Old Days: Biz-Av Flexes Its Muscles And Bulks Up

"This community won't stand still "  Olcott

"It's been really strong for us," was the description of his NBAA
convention experience from Paul Jackson, president of AeroCourier Group of
Wichita and Minneapolis. Even with a new propjet-power product to launch, the
question of attending a game-delayed NBAA wasn't an automatic one for a small
company in its first year of existence. But in the end, it was "a
no-brainer" to decide on making a public launch of the group's new program
at this NBAA. "We had to be here, but in what form and at what level was
the question," Jackson noted.

So the new mock-up stayed at home to preserve needed budget funds, while the
staff and display models and press kits came to work out of a 20-by-10-foot
booth. Representatives stood before the press on opening day for AeroCourier
Group's share of premium spotlight time, showing off its concept for a new
single-engine, propjet freighter. And as it turned out, Jackson said,
"we've had some good contacts and the chance to focus on them about the
airplane."

The AeroCourier is designed as either a 10-seat aircraft or as a cargo
airliner capable of handling 340 cubic feet of freight. Use of an unpressurized
design, simple systems and Pratt & Whitney Canada's PT-6A-114 holds out the
promise of a price under $1 million each.

And in true Cinderella fashion, coming to the ball helped the company land
its first order. AirShares Elite of Atlanta signed on for 20 planes for its
fractional-ownership operation. AirShares Elite may sound familiar. It is the
Atlanta firm that last year launched itself into the fractional business using
Cirrus Design Corp.'s SR20 and SR22 piston singles.

And AeroCourier Group wasn't alone in enjoying some premium  as in
undiluted, non-discounted  spotlight time.

Airbus stunned the market by announcing a new entry into the super-heavy
class of business jets: the World Ranger business airliner. The community's
first wide-body based executive aircraft is a derivative of the A340-200
airliner and is expected to sell about two units per year. In addition to its
119-foot-long by 18.5-foot-wide cabin, the World Ranger will boast a range of
8,000 nautical miles. Airbus decided to make the launch after selling nine A340s
as corporate airliners on an on-demand basis. Currently, no orders exist for
this monster, but sales of the A319-based Airbus Corporate Jet or ACJ have been
brisk with more than 30 orders on the books and eight aircraft already in
service.

Bombardier drew attention by flying its new Continental mid-size business jet
from Wichita to Lakefront for its public debut. With a select group of cameras
runway-side to record the arrival, and about two-score media people in
attendance for a program briefing and ceremonial ribbon cutting, Bombardier
assured itself of some front-page coverage in the show dailies and leading-story
status in many of the aviation publications that covered the convention. The
prototype then returned to ICT for the continuation of its flight-test program.

Brazil's Embraer brought its new Legacy business jet to NEW for its first
North American showing, less than a month after its international debut at the
Dubai Air Show and only a day after its certification by airworthiness
authorities back home in San Jose dos Campos. A competitor to Bombardier's
Continental, this $19.8 million business jet is due for FAA approval shortly
before its first scheduled U.S. delivery in June.

You could make the same observation about Dassault's decision to give its new
Falcon 7X long-range business jet an NBAA presence following its introduction at
the 2001 Paris Air Show in June. With the company now in "firm order
mode," this 5,700-nautical-mile jet was able to boast of landing letters of
intent and deposits from 40 customers at a price of $35.65 million per copy.

NBAA number 54 also brought out an all-new concept for a business aircraft.
The Humming employs hybrid lift devices that blend the delta wing of a
fixed-wing aircraft with a rotary ring that encircles the main body. With four
jet engines powering the spinning ring, the Humming could handle VTOL operations
from small facilities and fly level at 360 knots, between takeoff and touchdown.

With several of NBAA's working sessions focused exclusively on security for
business aviation, it came as no surprise that companies were promoting new
products geared toward protecting business aircraft in flight. Among them was
Total Aircraft Services, which floated a concept for an on-board infrared
countermeasures system to fool the infrared sensors of some shoulder-launched
anti-aircraft missiles. Some operators seemed interested in the product. It
would cost $2 million to $3 million to install the device in a business jet.

Non-Discounted: Sales
Approach NBAA 2000's $2 Billion-Plus

Talks Of A Slump May Be Overstated

Forecasts from industry powerplant leaders Honeywell and Rolls-Royce both
seemed to portend a flattening in deliveries over the immediate six to 12
months, but other indicators point toward the pace of placement returning to a
growth mode in 2003 and for the next two years or so thereafter. As if to give
these crystal-ball outlooks some validity, NBAA 2001 generated more of the sort
of news that illustrates that businesses intend to keep buying to keep flying.

One case in point: the NBAA Convention delivered nine-figure's worth of new
orders, proof positive that the 54th NBAA had some full-value action for which
no discounts applied. Thank UAL Corp.'s new Avolar division for a large chunk of
this value-added action.

For months the source of considerable breathless conversation and formidable
can-they-do-it wondering, Avolar burst onto the public scene a scant eight
months ago. By a week ago, the company enjoyed the status as the world's richest
launch, with 224 jets on order worth a staggering $6.3 billion.

In New Orleans last week, Avolar extended its impact further by announcing
another $750 million in business-jet orders representing another 82 aircraft,
including 57 new Learjets  split between 45s and 60s  plus 15 new Beechjet
400As, with options for another 10. The new fleet order total: 306 airplanes.
The new fractional also announced a selection of a headquarters city  Chicago
 and revealed that formal operations are now underway, several weeks ahead of
schedule.

But Avolar's new orders weren't the only big-bucks news. Chicago-based Indigo
Air penned an order for 25 new Embraer Legacy Corporate Shuttles to be
configured for 18 to 19 seats. Options for another 50 push Indigo Air's
potential commitment to $1.1 billion. Including other revelations at NBAA, total
announced sales approached the $2 billion+ mark reached in 2000. If there was a
discount here, it was a small one.

Lower
Key, Not Lesser Importance: Many Elements Stay The Same

Aside From The Big Business Aspects, The Human Factors Loomed Large

NBAA
did lack virtually all of the evening and semi-business social functions
typical of recent years, including the closing-night gala that usually serves as
the stage for the association's annual awards event. But the awards themselves
went to the recipients present. The two top awards rounded out the ceremonies,
with former NBAA board member Myron Collier receiving the association's Doswell
Award and no less than Paul H. Poberezny, the father of the EAA, receiving
NBAA's lifetime achievement award.

Collier's honor stemmed from his years of service to business aviation
through his service on the NBAA board, as a flight instructor and as a
schoolteacher who encouraged students to sample aviation. Poberezny's received
his award for his lifetime spent encouraging aviation, aircraft building and
individual aviators through his association and the annual sport-aviation
gathering at Oshkosh that draws together the aviation community in its highest
saturation.

The presentation of the Doswell and lifetime achievement awards closed out
the only organized evening event on the convention agenda, a convention-floor
reception designed to provide some extra networking time for delegates who spent
most of their first day sitting through workshops and professional-development
seminars.

This was, as it turned out, a hardcore crowd who attended NBAA with a sense
of purpose. One vendor fretted that the floor seemed even emptier than he had
anticipated, and started upstairs for the pressroom to ask for an attendance
number. But as he arrived on the convention center's second floor, he noticed
that the audiences overflowed the seminar rooms into the hallways outside.

"Those rooms were standing-room only," the now-embarrassed vendor
related later. "And when the sessions ended, we handled a steady stream of
people anxious to talk to us. We actually did better here with this crowd than
we did last year with so many more people walking the exhibits."

"The difference was a total lack of junketeers," he said. "The
people here were here to do business and were serious about the business they
were here to do. A body could get to like this leaner, meaner NBAA
convention."

As the delegate ranks have swollen the NBAA convention crowd, the
exhibition-hall size and the number of exhibitors, it's become more difficult to
conduct all the business on the collective agendas of operators and vendors
alike. "That's something we're going to have to look at," said Jack
Olcott, the NBAA president.

In a conversation during the convention's final hour Friday, Olcott
acknowledged that the solution to the over-saturation typical in years past may
prove to be a four-day NBAA. "We're going to poll our members and look at
the pros and cons, but it's what many people have stated they would like to see
to spread out the intensity we have had in recent years."

Olcott expressed satisfaction and gratitude at the people and companies who
persevered the challenges brought by the change of schedule. "I think it
shows the strength of our community and their determination to not give in to
fear or paranoia about what might happen," Olcott noted. "It shows the
dedication of the people who make business aviation the viable force it is
today."

The successes of the much-discounted 54th NBAA also revealed the dedication
of NBAA's staff, which in three short months had to coordinate the logistics of
two conventions: the one that didn't happen and the one that did. "They are
the ones who deserve the lion's share of the credit for what we accomplished
here," Olcott stressed. "Our staff really pulled together to help those here
achieve something positive."

From inside the NBAA offices, the events of September 11 started a chain reaction
of proportions unprecedented in the convention's 53-year history. For example,
on that Tuesday itself, staff members declined to leave early to tend to family
after Washington, D.C., effectively shut down after a Boeing 757 struck the
Pentagon.
Olcott told staffers that if any had worries about their family or personal
safety that nobody would make an issue of their leaving. Nobody left.

In the first few hours after the attacks of September 11, the general aviation
community had no real idea when security authorities might relax their
unprecedented reaction to the terrorist attacks  the complete closure of
national airspace. During the restoration process, non-scheduled traffic came
second and continuing restrictions kept hundreds of airports closed and
tens of thousands of airplanes trapped. NBAA went to work for its members,
appearing before the FAA, the National Security Council, and members of
Congress.

Once the rescheduled dates for the 54th NBAA convention were announced on
September 20, the real heavy lifting began. Some NBAA personnel undertook the chores
of canceling the arrangements for one convention while others began arrangements
for the new one. Sometimes the overlap increased the workload. Answering the
barrage of questions from members, exhibitors and reporters required careful
attention to detail and coordination between the processes involved in working
two conventions from opposite ends of the planning process.

A
Worthwhile Exercise By A Community Under Assault

"A Gathering of Our Community" Showed The Community's Strengths

Despite the pre-show discounting, A Gathering of Our Community turned out to
be an effective, productive show for those who attended. "In the end,"
said Olcott, "I couldn't be more pleased with the quality of the people
here and the organization of the convention itself. Our community truly came
together."

That struggle will continue. So will efforts to restore airspace access to
its pre-9/11 level, something the FAA continues to work for. "We provided
93 percent of services that the FAA had been providing prior to the terrorists
attack," said Steve Brown, associate administrator of air traffic services
for the FAA. "And I want it to go to 102 percent and then 110
percent," he told NBAA members during the opening general sessions.

The need for the community to pull together and communicate with one another
continues with increased urgency. Olcott observed that there are security
proposals under consideration that could severely handicap the freedom and
utility of private flying across the board. "We can't protect our freedoms
by becoming less free," Olcott noted. We also can't serve the Constitution
by erecting barriers to our lives that are unconstitutional, particularly given
that some of the ideas floated by our Attorney General and the Office of
Homeland Security will serve only to institute artificial perceptions of
security.

So, general aviation must pull together as a community irrespective of its
internal differences. Private pilots and business pilots, individuals and
corporations, government and citizens, will all suffer similar consequences.
Recognize this, the unanimity so far has been remarkably strong  the front
united.

"At no time have we had more to say, nor are we more proud of our
community," Olcott noted several times during the convention. "And
that need continues acutely. We can't be idle or disengaged at any level."

In sum, the convention was more than a financial shot in the arm for the
participants. It also served as a call-to-arms for the business aviation
community. Challenges relating to security issues, emanating from both security
officials and those who would terrorize us, aren't going away any time soon. And
business aviation started dealing with that reality at this year's NBAA
convention.

For those who weren't there, there is no way to gauge the lost opportunities.
But they can step back on board when the meeting convenes next year. We'll look forward to seeing them, and you, in Orlando.

Fly safe and we'll see you back here Thursday for AVweb's
expanded BizAv coverage detailing the product developments announced at NBAA
2001.